Amid soaring raw material costs, we commit to absorbing cost pressures through innovation and efficiency improvements instead of passing them to our customers.

According to the latest data from Chem99 on October 9, the price of #1 electrolytic copper at the Shanghai Nonferrous Metals Trading Center has surged to 85,750 yuan per metric ton, marking a significant increase from late September and hitting a new recent high.

This sharp rise in copper prices directly impacts the cost structure of the inductor industry, as copper is a primary raw material for inductor components.

01. Copper Prices Hit Record Highs

On October 9, 2025, the price of #1 electrolytic copper at the Shanghai Nonferrous Metals Trading Center reached 85,750 yuan per metric ton(Shanghai delivery).

Historically, copper prices have shown a rapid upward trend since the end of September.

Compared with 82,400 yuan per ton on September 25, the price has jumped by more than 3,000 yuan per ton in just a few days, representing a notable increase.

The market reacted swiftly. East Money reported that after the price surge, early trading saw limited interest, with sellers initially offering high premiums for standard cathode meeting no demand, leading to a quick downward adjustment in those premiums.

This indicates low acceptance of high copper prices among downstream manufacturers and a clear weakening in purchasing willingness.

02. Challenges Mount for the Inductor Industry

As a key raw material for inductors, copper price fluctuations directly affect product costs.

Peak Tech, responding to investor inquiries, has previously indicated that inductor manufacturing requires winding copper wire.

Therefore, the rising copper price exerts direct pressure on production costs.

Facing this challenge, a strategic shift towards “substitution of copper” is emerging within the industry.

To reduce copper usage, inductor manufacturers are turning to higher-performance magnetic powder cores, innovating in materials to counter cost pressures.

Simultaneously, the inductor industry is undergoing technological upgrades and a push for domestic substitution.

Against the backdrop of a reshaping global supply chain, domestically produced rod-type inductors are gradually breaking foreign technology monopolies and achieving mass production.

03. Our Strategy and Commitment

In this environment of sharply rising raw material costs, we solemnly declare: We will not increase prices for our existing customers in the short term.

This commitment is inspired by the lesson of Zhoukou MSG Plant’s “no price increase” strategy leveraging internal capabilities to absorb costs, thereby enhancing credibility and competitiveness with high quality and stable pricing.

Multi-pronged Approach to Absorb Costs

We will implement several measures to tackle the rising costs:

First, deepen technological innovation, optimize product design, and improve material utilization rates.

Second, enhance production processes, increase efficiency through automation, and reduce energy consumption per unit product.

Finally, strengthen supply chain management, build strategic partnerships with suppliers to ensure stable raw material supply.

Focus on Long-term Development

We believe the current industry challenge is an opportunity to demonstrate our strength and commitment.

Much like how Zhoukou MSG Plant navigated from challenges to success through its “no price increase” strategy, we are confident this test will further enhance our market competitiveness.

We reject a simple “cost-pass-through” approach. Instead, we choose to strengthen our internal cost absorption capacity and grow together with our customers.

04. Industry Outlook

In the short term, copper price trends remain uncertain, implying persistent cost pressures for the inductor industry.

However, this challenge will also accelerate industry consolidation and technological upgrading, pushing companies from competing on price to competing on value.

With the rapid development of sectors like 5G communication, new energy vehicles, and industrial automation, demand for high-performance inductors continues to grow.

We will focus on technological innovation and product quality improvement, collaborating with industry chain partners to promote the sector’s healthy development.

In these times of challenge and opportunity, we reaffirm our commitment to our customers. We will not raise prices following the market trend. Instead, we will enhance our competitiveness through internal optimization and technological innovation.

As the case of Zhoukou MSG Plant demonstrated: “The challenge is common to all manufacturers. Those with stronger adaptability, better cost absorption capability, and a pricing edge will secure both raw materials and the market.”

This philosophy will guide us forward steadily through the changing market landscape.